A businessman who failed to land the controversial contract to run Government-owned Stonington Beach Hotel is calling on Premier-designate Alex Scott to review how John Jefferis won the deal.

P.K. Patnaik said the people of Bermuda had been "left holding the bags" over the deal negotiated by Mr. Jefferis, who managed to win himself multi-million dollar concessions and extra land after he was selected.

Mr. Patnaik said if Mr. Scott does not fully review how the contract was awarded, he will write to Governor Sir John Vereker to demand the Auditor General Larry Dennis does an audit of the deal.

The Royal Gazette revealed last week that after Mr. Jefferis was picked to manage the hotel, he negotiated a rent-free holiday of five years and much lower annual rent payments than he originally proposed; had the lease extended from 21 years to 50 years; and secured a 1.9 acre plot of ocean-front land with two cottages which were not originally on offer.

Tourism Minister Renee Webb insisted everything was handled properly and the new terms reflected that Mr. Jefferis, a former managing director of Elbow Beach Hotel, would be investing $10 million in the property.

Mr. Patnaik's company, Montibello Foods of North Carolina - in conjunction with Bermuda-based Mega Contracting Services - did not make the short-list of two companies for Stonington, which was owned by Bermuda College.

Mr. Jefferis' company Coco Reef Resorts and Bermuda Resort Hotels were short-listed, but a selection committee gave the award last December to Mr. Jefferis.

Mr. Patnaik wrote to former Premier Jennifer Smith saying there was a conflict of interest because BRH boss Billy Griffith sat on the Board of Governors of Bermuda College. BRH was originally awarded the contract, but it was put out to tender again and Mr. Jefferis won it this time.

Mr. Patnaik said when he wrote to Ms Smith complaining about the way BRH got the contract, he "got nowhere".

He told The Royal Gazette yesterday: "Your article last week opens up a lot of holes which the people of Bermuda were not aware of at the time.

"The people of Bermuda need to know that we are not going to give up. We are going to pursue this with the new Government and (if nothing happens) we will write to the Governor to get him to get the Auditor General to audit it.

"We complained originally that there seemed to be back door contacts (over the original award to BRH) and that's what we were complaining about.

"We feel very strongly now from what we've seen that Mr. Jefferis got a privileged contract.

"Once the new government is in place, we will appeal to the Premier to review the whole matter of how it was handled.

"We don't care about being fairly judged, but it was not fairly judged and your article has fully justified that. Mr. Jefferis got all the breaks from Government.

"I had proposed to make rent payments (of $250,000 a year) to the College from day one and to pay for all the inventory.The original request for proposal was for a seven year lease, but I proposed five years to give the Government the opportunity to review it and if it isn't working they could throw us out.

"We wanted to tie in the training of College hospitality students with the University of South Carolina School of Restaurant, Tourism and Hotel Management.

"With the deal given (to Mr. Jefferis), the country and the College have been left holding the bag. The hotel is not that bad.

"We've stayed there several times. There are some problems but this can be fixed, but the deal Mr. Jefferis got was a real golden handshake and the people of Bermuda need to know we are not giving it up.

"We have always felt that we were being discriminated against and not given a fair opportunity. That was our complaint from day one.

"If these deals had been given to us and Mr. Griffith (it would be fine) but we were completely blindsided."

The Royal Gazette revealed last week that after Mr. Jefferis was selected by a committee of civil servants and a Californian hotel consultant last December, the lease was extended from 21 years to 50 years, and he was given an extra 1.9 acre plot of land with two cottages which he wanted but which was not on offer.

The plans for Stonington were re-drawn four months after he was selected to give him the extra land, which the College had earmarked for halls of residence.

And after he was selected Mr. Jefferis was able to change his proposals for the rent he would pay, giving himself a five year rent free period, and rental terms for the duration of the lease which are significantly less than what he proposed when he won the contract and which will save him millions of dollars.

At a press conference last week, Ms Webb did not dispute the factual accuracy of The Royal Gazette story but accused the newspaper of electioneering for the United Bermuda Party, a charge strongly refuted by editor Bill Zuill.

Ms Webb said at the time: "The selection process in Mr. Jefferis' case was sound and fair. The committee charged with responsibility in this area is of the highest integrity and conducted their affairs in a manner that was a credit to the organisations they represent."

College President Dr Michael Orenduff told The Royal Gazette last week he was "very concerned" about the deal, which he said would leave the college with an immediate liability of $1.25 million and no rent for five years, and said he had asked the College's lawyers to look at it.

Mr. Jefferis, who owns the award-winning Coco Reefs Resort in Tobago, said the $1.25 million was money which the College owed him for advance bookings.

He said he had to spend a great deal of money on upgrades and ensure staff at the hotel were not made redundant.

"All this put together and I don't think it is a great deal for me financially, but it will be great entertainment, and that's why I'm doing it," said Mr. Jefferis.